Canada's Economy to Slow Sharply in 2027 Amid Ongoing Trade Tensions
Deloitte Canada has revised its economic forecast for 2026 and 2027 due to ongoing trade tensions between Canada and the United States. The consulting firm raised its 2026 growth forecast by 0.2 percentage points to 0.9 per cent, citing a stronger-than-expected first half.
The forecast was completed on September 9 and includes the US Section 338 tariffs imposed on August 22 and Canada's retaliatory tariffs of September 8. Deloitte expects exports to fall 0.9 per cent annualized in the third quarter and 5.0 per cent in the fourth, with the decline concentrated in goods.
The firm also forecasts business investment to rise 1.6 per cent this year as many firms hold off on expansions amid uncertainty over US market access, before strengthening to 3.5 per cent in 2027 as major projects reach final investment decisions.